The Commission’s record of alleged “regulatory
restraint” toward the telecommunications sector over the past 13 years has come
under fire by a number of commenters in the matter of “A National Broadband
Plan for Our Future.” It is alleged that the Commission’s actions have produced
market outcomes that are contrary to the “public interest.” These comments urge
the Commission to impose myriad new regulations that are supposedly needed to
promote “competition” and protect the “plight of Consumers.” A more
interventionist regulatory regime, however, will only hurt consumers and
discourage infrastructure wealth creation.

Critics of the status-quo broadband market cite a number of studies, surveys, and reports which show that a sizable minority of Americans cannot get terrestrial broadband access at a reasonable price and that Americans who can get affordable residential broadband in some cases have only one option. Advocates of a more hands-on regulatory approach take it as a foregone conclusion that if affordable broadband is not universally abundant and Americans do not have six or more choices for broadband access, then the broadband market must be failing and consumers are in need of saving by government regulators through such rules as open access mandates, line sharing requirements, and price controls.

These commenters, however, overlook the possibility that factors other than market failure may be responsible for the current state of the U.S. broadband marketplace. In fact, the alleged underperformance of the U.S. broadband marketplace is rooted not in the failure of the market but in the failure of government. Thus, while it is true that, as Free Press argues in its comments, government has failed broadband consumers, this is not because government has been too averse to regulate and legislate. In fact, the current broadband marketplace is anything but free. Distortions stemming from ill-conceived regulations plague the broadband market at all levels of government. The Commission can best serve the public interest in broadband by relaxing outmoded regulations that distort efficient market outcomes.